Motives of customers’ e-loyalty towards e-banking services: a study in Saudi Arabia

ABSTRACT

Customers’ e- loyalty becomes critical to a company’s survival and profitability with the recent growth in e-commerce. Developed in this context, this paper aims to test the motives of e-satisfaction and e-trust, which predict customers’ e-loyalty towards e-banking services. The study focused mainly on motives such as security/privacy, responsiveness, website design, and convenience. An empirical study was conducted with 237 customers of 30 retail banks in Saudi Arabia. The structural equation modelling method was used to test the research hypotheses. The findings show that both e-satisfaction and e-trust stimulate e-loyalty. These two variables are predicted by security/privacy and convenience. However, responsiveness and website design are found to have a significant influence on only e-satisfaction. This study contributes to the knowledge on determinants of e-loyalty in e-banking. The findings provide clear directions for practitioners to build durable relationships with their e-customers by improving their trust and satisfaction towards their e-services.

KEYWORDS:

• e-loyalty
• e-trust
• e-satisfaction
• e-banking services
• Saudi Arabia

Highlights

• Customers’ e-loyalty is important to a bank’s survival and profitability.

• E-satisfaction and e-trust are strong predictors of e-loyalty towards e-banking services.

• Security/privacy and convenience are significant predictors of both e-satisfaction and e-trust.

• Responsiveness and website design have strong influence on e-satisfaction but weak on e-trust.

• Saudi e-customers are loyal towards the e-services of their banks because they trust them and are satisfied by their quality.

• E-retailers who want to succeed on e-retailing market should build secure, convenient, attractive, and responsive websites.

Executive summary

Customer loyalty is a major concern for the survival and profitability of any company. With the recent growth of e-commerce, attract, satisfy, and retain e-customers become a crucial purpose of companies. Therefore, the research of motives of e-loyalty remains fundamental for a better understanding of e-customers’ behaviour. This study is developed in this context. It aims to theoretically develop and empirically test a comprehensive conceptual framework of motives of e-loyalty towards e-banking services. The focus of this study is mainly on e-trust, e-satisfaction, security/privacy, responsiveness, website design, and convenience. An empirical study was carried out in the Saudi market including 237 customers of banks. The Structural Equations Modeling (SEM) method through the software LISREL was used to test the research hypotheses. The findings indicated that the e-loyalty was strongly stimulated by both e-satisfaction and e-trust. These two variables were found significantly predicted by security/privacy, and convenience. However, responsiveness and website design were found to have a significant influence on only e-satisfaction. This study is theoretically interesting since it enhances our understanding of customer loyalty towards e-services. Additionally, it is among the earliest of its kind to test the level of e-loyalty, e-satisfaction and e-trust of Saudi customers towards these services. From a managerial perspective, this study is relevant since it provides for managers of e-banking services key motives for building robust and durable relationship with their e-customers, which is mandatory for the survival and performance of banks.

Acknowledgments

The author would like to express special thanks to Bank Albilad Chair of Electronic Commerce (BACEC) for the support of this paper and the scientific research works in the Kingdom of Saudi Arabia.

Disclosure statement

In accordance with Taylor & Francis policy and my ethical obligation as a researcher, I am reporting that I have NO financial and/or business interests in any company that may be affected by the research reported in the enclosed paper.